World Economy

Fairer Pensions

Fairer PensionsFairer Pensions

China will abolish a dual-track pension system that favors government employees and discriminates against others to create a fairer retirement-savings system. Under existing rules, about 37 million employees with government agencies, communist organs and public institutions don’t have to contribute anything to their pension savings, with the government paying pensions of about 90 percent of their pre-retirement salaries, Xinhua reported. Those employed by businesses from banks to bakeries must contribute 8% of their salary to pension accounts, on top of 20% of their wages that’s paid by employers to a pooled pension fund. On average, private retirees end up with 40% of their working pay.